Today’s News: Doctor’s Face Medicare Payout Cut, IRS Announces Health Insurance Tax Credit and Health Insurers Fight Regulations

Posted in Health Insurance , Medicare , Small Business Health Insurance

May 18th, 2010

The health care industry has undergone a number of changes in the past few days. Doctors, health insurance companies and even the IRS are making or seeing drastic adjustments – let’s take a closer look.

Doctor’s Face another Medicare Payout Cut

In March, we reported that doctors were ditching their patients because their Medicare payments had been cut by 21 percent. Now it appears that doctors could face yet another 21 percent payment cut in Medicare reimbursement on June 1. In 1997, a Medicare formula was established that said rates should be cut every year, but Congress has blocked the cut seven out of eight years.

In order to block the cut for June, Congress would need to vote within the next two weeks. (CNNMoney.com)

IRS Announces Health Insurance Tax Credit

As a part of the health care overhaul law, the IRS is planning to announce the ground rules for small firms that want to claim the new federal tax for health insurance. The tax credit would cover up to 35 percent of the premiums that some small businesses pay on behalf of their workers. However, the credit will only be applied toward dental and vision benefits – not medical.

In the meantime, small business lobbying groups have filed a lawsuit against the law, stating Congress doesn’t have authority to mandate coverage. (Associated Press)

Health Insurers Fight Regulations

Health insurance companies are lobbying to fight what they consider to be strict regulation of premiums and profits under health care reform. The companies’ lobbyists are trying to shape regulations so that there are better definitions of what “unreasonable” premium increases are – and to avoid having to pay consumers rebates if the companies do not spend enough on patient care.

Senator John D. Rockefeller IV (D-WV) said companies now want to control how laws are implemented since they couldn’t control health care reform’s passage. (New York Times)